Outward processing means that Union goods may be temporarily exported from the customs territory of the Union in order to undergo processing operations. The processed products resulting from these goods can be re-imported and released for free circulation with total or partial relief from import duty. A total relief from import duties must be granted when the goods have been exported merely to be repaired free of charge because of a contractual obligation or because of a manufacturing or material defect. In other cases of outward processing, the import duties on the re-imported products are calculated only on the basis of the value resulting from the processing operation undertaken outside the customs territory of the Union.
Outward processing procedure is designed to give businesses the possibility to take advantage of benefits such as lower labour costs or specific technical expertise in non-EU countries.
An authorisation from the customs authorities is required for the use of the outward processing procedure. The competent customs authorities must specify the period within which the outward processing procedure is to be discharged. Such authorisation can also allow businesses to previously import non-agricultural processed products obtained in a third country in return for the export of an equivalent quantity of Union raw materials – in this case a guarantee must be provided.
The main requirements to obtain such authorisation are:
- To be established in the customs territory of the Union, and
- To provide necessary assurance of the proper conduct of the operations.